The Power is Now

Sacramento Apartment Market Ranks Among the Nation Most Competitive

Homeownership Program

Author: Serina Lowden

A recent publication by RentCafe.com, Sacramento takes a position in the country’s top five most competitive rental market lists. The most competitive markets according to the report are those that have most attracted new residents from the highly densely populated areas. This attraction is associated with exhibiting the most affordable lifestyle, proximity to opportunities in the best states, and spacious grounds. Additionally,  rent cafes took into consideration metrics of the occupancy rates of each market. The higher the rate of occupancy, the more competitive it is and less competitive if the occupancy rate is lower. The average number of days apartments are vacant, the lesser days the more competitive the market is and more days of vacancy means it’s less competitive. The report took into account competition for units and the average credit score of the apartment applicants.

Sacramentos apartment has a recorded occupancy rate of 97 percent marking a 1.6 percent higher than the nation’s average occupancy rate of 95.4 percent. On average Sacramento’s vacant apartments sit on the market for only 24 days or less compared to the nation’s overall of 28 days. It is a clear indication of how competitive the market is since a market is neutral if the number of days is more than 90 days.RentCafe records show that Sacramento has a fair median credit score of 653 which is higher than the nation’s average of  640. Each available vacant unit based on the report has an average of 23 applicants competing for it while the nation’s number of applicants for each vacant unit is only 14.

According to the Yardi Matrix rent report, Sacramento saw a 14.5 percent rent growth which is only one percent of the nationwide figure. This kind of rent growth is not likely to decline with the consistently high demand and a lower rate of new apartment construction, said Doug Ressler, business manager of intelligence at Yardi Matrix. As recorded by  Zumper average rent for a studio is 1295 a 1 percent down from last year, one-bedroom apartment has increased by 3 percent to $1590.A  two-bedroom with a 3 percent increment is $1911. The cost of rent in Sacrament as of January varies depending on size, location, and quality. Rent growth is however is the same in both “high class” apartments and lower scale apartments according to Yardi Matrix.

Based on the migration patterns observed by Ressler, the rental demand will continue to hike as more people move to Sacramento. The fact that land is cheaper and highly available in Sacramento than in the surrounding areas, will keep the demand strong pishing the prices higher. The quality of life in Sacramento is great, especially given its proximity to larger and more glitzy cities like the Bay area. This makes it a highly desired location that exhibits all of the economic growth characteristics that promote real estate investments

Sources;

https://www.apartments.com/houses/sacramento-ca/

https://www.zumper.com/rent-research/sacramento-ca

https://www.bizjournals.com/sacramento/news/2021/12/31/sacramento-apartment-market-among-most-competitive.

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